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CS Professional · Insolvency and Bankruptcy - Law and Practice · Group Insolvency

Orion Ltd (India) is in CIRP. Its Dubai subsidiary has assets there, and a Dubai court-appointed representative seeks cooperation. Under the current position in the IBC as taught for the elective, what is the statutory status of cross-border insolvency?

Currently the IBC relies on Sections 234 and 235, enabling bilateral agreements with other countries and letters of request to foreign courts for assets abroad. The UNCITRAL Model Law-based cross-border framework recommended by committees has not been enacted, so direct recognition of foreign representatives is unavailable.

  1. APart Z of the IBC, based on the UNCITRAL Model Law, is already notified and operative, so the Dubai representative can directly seek recognition
  2. BSections 234 and 235 allow the Central Government to enter bilateral agreements and Adjudicating Authority to issue letters of request, while the Model Law-based framework is not yet in forceCorrect
  3. CThe IBC prohibits any dealing with foreign assets of a corporate debtor
  4. DCross-border matters are decided only by the Supreme Court as original jurisdiction

Explanation

The IBC presently has Sections 234 and 235 for reciprocal arrangements with other countries and letters of request for foreign assets. The Model Law-based framework recommended by the Insolvency Law Committee has not been enacted. Hence no direct recognition route exists as in option A.

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